FR4014_20220930_omb

Supporting Statement for the
Investment in Bank Premises Notification
(FR 4014; OMB No. 7100-0139)
Summary
The Board of Governors of the Federal Reserve System (Board), under authority
delegated by the Office of Management and Budget (OMB), has extended for three years,
without revision, the Investment in Bank Premises Notification (FR 4014; OMB No.
7100-0139). The Federal Reserve Act (FRA) requires a state member bank to seek prior approval
of the Board before making an investment in bank premises or the securities of a corporation
holding its bank premises in certain circumstances. The Board has implemented this requirement
in its Regulation H - Membership of State Banking Institutions in the Federal Reserve System
(12 CFR Part 208), which requires a state member bank seeking to make such an investment to
provide prior notice to the appropriate Federal Reserve Bank. The Federal Reserve uses the
information provided in the notice to determine whether to object to the proposed investment.
The estimated total annual burden for the FR 4014 is 4 hours. There is no formal
reporting form for this information collection.
Background and Justification
Under section 208.21(a) of Regulation H, which implements section 24A of the FRA, a
state member bank is required under certain circumstances to provide notice to the Federal
Reserve prior to investing in bank premises or in the stock, bonds, debentures, or other such
obligations of any corporation holding the premises of such bank, or making loans to or upon the
security of any such corporation (collectively, a bank premises investment). Under section 24A
of the FRA and section 208.21 of Regulation H, a state member bank that is not well capitalized
or would not be so on a pro forma basis or that does not have a composite CAMELS rating 1 of 1
or 2 under the Uniform Financial Institutions Rating System must provide notice prior to making
a bank premises investment when the bank’s pro forma aggregate of all such investments,
together with any indebtedness of affiliates (aggregate investment level), wo uld exceed 100
percent of the bank’s capital stock and surplus, as defined in sections 208.21(a)(2) and (3) of
Regulation H. A state member bank that is well capitalized, would remain so on a pro forma
basis, and has a composite CAMELS rating of 1 or 2 must provide notice prior to making a bank
premises investment when its aggregate investment level would exceed 150 percent of the bank’s
capital stock and surplus. The Federal Reserve System uses the information in the notice to
determine if the proposal is financially sound and consistent with prudent banking practices. This
information is not available from other sources.

1

The CAMELS name is an acronym for the six types of risk components assessed in a rating that summarizes a
financial institution’s financial condition and performance: (C) capital adequacy risk, (A) asset quality risk, (M)
management risk, (E) earnings risk, (L) liquidity risk, and (S) sensitivity to market risk.

Description of Information Collection
There is no prescribed form for an investment in bank premises notice. Any required
notice must be sent by letter to the Reserve Bank that has direct supervisory responsibility for the
state member bank submitting the notice. The notice must be submitted at least 15 days prior to
the subject investment and must identify the relevant filing requirement, state the facts involved
in the proposed investment, and describe the reasons why the Federal Reserve should not object
to the notice.
Respondent Panel
The FR 4014 panel comprises state member banks.
Time Schedule for Information Collection
This information collection is event-generated. A notice required by section 208.21 of
Regulation H must be filed at least 15 days prior to a proposed investment in bank premises.
Public Availability of Data
No data collected by this information collection is published.
Legal Status
The FR 4014 is authorized by section 24A(a) of the FRA, which requires that state
member banks obtain Board approval prior to investing in bank premises that exceed statutory
thresholds (12 U.S.C. § 371d(a)). The FR 4014 is additionally authorized by section 11 of the
FRA, which authorizes the Board to require such statements and reports of state member banks
as the Board may deem necessary (12 U.S.C. § 248(a)(1)). The FR 4014 is required to obtain a
benefit.
The information contained on the FR 4014 is not considered confidential unless an
applicant requests confidential treatment in accordance with the Board’s Rules Regarding
Availability of Information. 2 Requests for confidential treatment of information are reviewed on
a case-by-case basis. Information provided on the FR 4014 may be exempt from disclosure
pursuant to exemption 4 of the Freedom of Information Act (FOIA) if it is nonpublic commercial
or financial information, which is both customarily and actually treated as private by the
respondent (5 U.S.C. § 552(b)(4)).
Consultation Outside the Agency
There has been no consultation outside the Federal Reserve System.

2

12 CFR 261.17.

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Public Comments
On February 18, 2022, the Board published an initial notice in the Federal Register (87
FR 9348) requesting public comment for 60 days on the extension, without revision, of the
FR 4014. The comment period for this notice expired on April 19, 2022. The Board did not
receive any comments. The Board adopted the extension, without revision, of the FR 4014 as
originally proposed. On July 5, 2022, the Board published a final notice in the Federal Register
(87 FR 39833).
Estimate of Respondent Burden
As shown in the table below, the estimated total annual burden for the FR 4014 is 4
hours, based on an estimated average response time of 30 minutes. Because this information
collection is event generated, it is not possible to predict exactly how many notices would be
filed in a particular year. The average annual number of notices received in 2019 to 2020 was 8,
and the Board does not anticipate a material change in the number of notices received per year.
These reporting requirement represent less than 1 percent of the Board’s total paperwork burden.

FR 4014
Section 208.21

Estimated
Estimated
Estimated
Annual
number of
average hours annual burden
frequency
respondents3
per response
hours
8

1

0.5

4

The estimated total annual cost to the public for the FR 4014 is $242.4
Sensitive Questions
This collection of information contains no questions of a sensitive nature, as defined by
OMB guidelines.
Estimate of Cost to the Federal Reserve System
The estimated cost to the Federal Reserve System for this information collection is
negligible.

3

Of these respondents, 3 are considered small entities as defined by the Small Business Administration (i.e., entities
with less than $750 million in total assets), https://www.sba.gov/document/support-table-size-standards. There are
no special accommodations given to mitigate the burden on small institutions.
4
Total cost to the public was estimated using the following formula: percent of staff time, multiplied by annual
burden hours, multiplied by hourly rates (30% Office & Administrative Support at $21, 45% Financial Managers at
$74, 15% Lawyers at $71, and 10% Chief Executives at $102). Hourly rates for each occupational group are the
(rounded) mean hourly wages from the Bureau of Labor Statistics (BLS), Occupational Employment and Wages,
May 2021, published March 31, 2022, https://www.bls.gov/news.release/ocwage.t01.htm. Occupations are defined
using the BLS Standard Occupational Classification System, https://www.bls.gov/soc/.

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